Proposed IETF standard bring the LAN to the cloud, but not everyone thinks that yet another standard is really necessary.

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The LAN is the most basic unit of networking architecture connecting two or more local machines into a network. In the modern world of cloud computing, the definition of local is changing and so too is the need to extend the LAN. That's where the new draft IETF specification for Virtual eXtensible Local Area Network (VXLAN) comes into play.

VXLAN was officially announced this week at VMworld as a multi-vendor effort including Cisco, VMware, Arista, Citrix and Red Hat.

"VXLAN enables multi-tenant networks at scale, and it is the first step towards logical, software-based networks that can be created on-demand, enabling enterprises to leverage capacity wherever it’s available," Steve Herrod, Chief Technology Officer at VMware blogged.

The basic idea behind VXLAN is to have a Layer 2 abstraction for virtual machines so they are not restricted to a particular LAN boundary.

"In short, VXLAN is a Layer 2 overlay scheme over a Layer 3 network. Each overlay is termed a VXLAN segment," the VXLAN IETF draft specification states. "Only VMs within the same VXLAN segment can communicate with each other. "

The VXLAN approach is intended to make it easier for network administrators to manage virtualization. Prashant Gandhi, director of product management for the Cisco Server, Access and Virtualization Technology Group told InternetNews.com that Cisco has been working on the VXLAN innovation for quite some time. Gandhi said that for applications running in the cloud, IT managers need to control every user’s access to data and applications with logical networks for each instance of the application.

"VXLAN will scale to meet the millions of logical networks required to run applications in the cloud with efficient utilization of network resources," Gandhi said. "By segmenting these VMs and applications via highly secure virtual networks, customers will be able to achieve the security required for multi-tenant cloud environments and ease deployment of applications in the cloud."

Cisco is also moving fast to allow its customers to try out VXLAN. The Cisco Nexus 1000V Series support for VXLAN will be available in Beta by September. Gandhi noted that beyond the VXLAN technology, Cisco Nexus 1000V and VMware vCloud Director 1.5 will offer auto-deploy capabilities to simplify installation and deliver VXLAN-based network isolation that simplifies troubleshooting and management of applications running in the cloud.

While the VXLAN specification is being proposed as an IETF standard, it's not an idea that all networking vendors are embracing.

Juniper Networks spokesperson Andy Ingram told InternetNews.com that VXLAN is an interesting idea and something that Juniper is still investigating. Other vendors aren't as positive on the idea.

"We don't think that the way to simplify the data center is to introduce a massive new PIM overlay to what is already a very complex environment," Paul Unbehagen, Data Center Architecture Leader at Avaya told InternetNews.com. "VXLAN doesn't offer any solutions that haven't already been addressed by SPB more simply and elegantly -- it's just one more protocol that would increase network complexity for IT administrators."